Help for K-F

When Kaiser-Frazer last week got a new $25 million RFC loan to help keep it solvent until it can sell its big backlog of cars, the terms were stiff. (K-F already owes RFC $43 million.) RFC ordered K-F to: 1) cut production from 800 to 600 cars a day; 2) raise no prices without RFC consent; 3) pay off the loan with 90% of the wholesale selling price of each car as it is taken out of storage.

Some businessmen questioned whether the loan should have been made at all. Said the Wall Street Journal: "Why should our government . . . maintain output of civilian goods at the very moment it is attempting a large-scale conversion of industrial production to warmaking equipment?" The answer seemed to be that RFC wanted to keep K-F going in the hope that it could get some arms contracts.

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